Rename staking tokens to `*ZEAL`. Rationale:
If all tokenizations of ZEC maintain the invariant that <something>ZEC<something> represents a token intended to have a value pegged to mainnet ZEC, it will improve usability and comprehension for users across all ecosystems around ZEC. Any token with any freedom in exchange rates should have a different name. I picked "ZEAL" whimsically, but not particularly attached to it. ;-)
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README.md
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README.md
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@ -72,14 +72,14 @@ pegzone has four parts: token design, the staking mechanics, the peg mechanics,
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There are three token types involved:
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- `PZEC` tokens are backed 1:1 by `ZEC` held in the Zcash mainnet shielded pool. They are issued and redeemed for mainnet ZEC allowing users of either network to hold and transact shielded & ZEC-denominated value.
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- `DZEC` tokens represent delegated stake weight to validators and they determine the weight of the staking consensus mechanism while leaving the control of ownership, transfer, and delegation decoupled from stake weight.
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- `SZEC` tokens are the source of delegated weight, and SZEC owners can transfer them freely and/or delegate them to validators.
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- `DZEAL` tokens represent delegated stake weight to validators and they determine the weight of the staking consensus mechanism while leaving the control of ownership, transfer, and delegation decoupled from stake weight.
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- `ZEAL` tokens are the source of delegated weight, and ZEAL owners can transfer them freely and/or delegate them to validators.
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The exchange rates between token types are as follows:
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- Zcash mainnet `ZEC` and `PZEC` have a pegged exchange rate impacted by usage fees.
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- `DZEC` and `SZEC` have a pegged exchange rate impacted by fees and staking returns.
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- Any `ZEC` holder can transform their ZEC into SZEC with a one-way peg (a burn mechanism). However, the exchange rate between `ZEC` and `SZEC` is otherwise floating.
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- `DZEAL` and `ZEAL` have a pegged exchange rate impacted by fees and staking returns.
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- Any `ZEC` holder can transform their ZEC into ZEAL with a one-way peg (a burn mechanism). However, the exchange rate between `ZEC` and `ZEAL` is otherwise floating.
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### Staking mechanics
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@ -87,38 +87,38 @@ As a proof-of-stake chain, the pegzone requires a staking token, and the
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pegzone must be able to control the supply of the staking token.
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However, rather than employ staking rewards as in the Cosmos Hub, we propose a
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new design based on a pair of tokens, “SZEC” and “DZEC”, with a predetermined,
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new design based on a pair of tokens, “ZEAL” and “DZEAL”, with a predetermined,
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time-varying exchange rate. The key advantage of this mechanism is that it is
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future-compatible with shielded staking, by eliminating the requirement for
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delegators to claim rewards.
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The staking token is a new token called SZEC. SZEC is obtained at a 1:1 ratio
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The staking token is a new token called ZEAL. ZEAL is obtained at a 1:1 ratio
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by burning ZEC on the Zcash chain. This avoids distributional issues about the
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initial holders of the staking token: all ZEC holders have the option to obtain
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SZEC if they choose to do so. SZEC is always freely transferable, as it
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ZEAL if they choose to do so. ZEAL is always freely transferable, as it
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represents an unstaked state of the staking token.
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SZEC can be converted to DZEC by delegating it with a validator, and DZEC can
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be converted to SZEC by removing it from delegation. SZEC and DZEC are not
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ZEAL can be converted to DZEAL by delegating it with a validator, and DZEAL can
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be converted to ZEAL by removing it from delegation. ZEAL and DZEAL are not
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exchanged at a 1:1 rate, but at a blockheight-dependent rate `D(h) <= 1` which
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measures the cumulative depreciation of SZEC relative to DZEC from
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measures the cumulative depreciation of ZEAL relative to DZEAL from
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genesis to blockheight `h` and decreases monotonically in `h`.
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Delegating 1 SZEC at height `h_1` results in `D(h_1)` DZEC bonded to a
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particular validator. Undelegating 1 DZEC at height `h_2` results in
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`1/D(h_2)` SZEC. This transaction is only settled after some unbonding period,
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during which the DZEC may still be slashed in the event of validator
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Delegating 1 ZEAL at height `h_1` results in `D(h_1)` DZEAL bonded to a
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particular validator. Undelegating 1 DZEAL at height `h_2` results in
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`1/D(h_2)` ZEAL. This transaction is only settled after some unbonding period,
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during which the DZEAL may still be slashed in the event of validator
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misbehavior.
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This can be thought of as treating all DZEC as if it had been delegated since
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This can be thought of as treating all DZEAL as if it had been delegated since
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(pegzone) genesis, and pre-debiting the staking rewards over the period before
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they began delegation, so that when they undelegate, they receive rewards only
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over the delegation period. Crucially, this means that all DZEC is fungible up
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over the delegation period. Crucially, this means that all DZEAL is fungible up
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to the choice of validator, because there is no need to track how long
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particular DZEC has been delegated.
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particular DZEAL has been delegated.
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This is economically equivalent to staking rewards as used on the Cosmos Hub,
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but because the staking reward is instead priced in to the SZEC/DZEC exchange
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but because the staking reward is instead priced in to the ZEAL/DZEAL exchange
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rate, there is no requirement for delegators to claim rewards, and all
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delegators are rewarded at the same rate (e.g., there is no question about the
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compounding interval). Removing staking rewards makes it relatively easy to
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@ -226,12 +226,12 @@ publicly-visible stake weight, but unlike on the Cosmos Hub, the identities of
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their delegators and the distribution of delegators to each validator will be
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protected. Validators can be pseudonymous, if there is market demand for
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pseudonymous validators – no strong identity is required. The shielding design
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follows straightforwardly from the SZEC/DZEC design, which ensures that all
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DZEC staked with the same validator is fungible.
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follows straightforwardly from the ZEAL/DZEAL design, which ensures that all
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DZEAL staked with the same validator is fungible.
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The pegzone has a main multi-asset shielded pool for SZEC and any other IBC
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The pegzone has a main multi-asset shielded pool for ZEAL and any other IBC
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assets moved into the shielded zone, as well as a single-asset shielded
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delegation pool for each validator's DZEC. Delegation transactions move SZEC
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delegation pool for each validator's DZEAL. Delegation transactions move ZEAL
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from the main shielded pool into the validator's delegation pool, escrowing the
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portion of the delegated funds that will be slashed in case of validator
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misbehavior. A user can undelegate their funds by moving funds back to the
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